TaxTMI 
TaxTMI 
2014 (5) TMI 402
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....sment order passed u/s. 143 (3) r.w.s 147 of the Act and holding that the issue of disallowance of interest was already considered in th original assessment order passed u/s. 143 (3) of the Act ?" {B} "Whether the Income Tax Appellate Tribunal was justified in fact and in law in ignoring its own decision on the identical issue for A.Y 1999-2000 against the assessee which has cascading effect on the appeal now decided in favour of the assessee ?" {C} "Whether the Income Tax Appellate Tribunal was justified in fact and in law in ignoring the findings given by the Assessing Officer in the assessment order passed under Section 143 (3) r.w.s 147 of the Act that preponement of SPN redemption to 15.3.2000 preponement of conversion date of wa....
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....wable as revenue expenditure. He noted that in the earlier year, similar additions were made by the Assessing Officer, which were deleted by the CIT [Appeals]. However, the Revenue had not accepted such decision of CIT [A] and the appeal was pending before the Tribunal on this point. He, therefore, concluded as under : ".. considering the above facts and circumstances, the claim of assessee company for deduction of Rs. 21,62,45,670/- as revenue expenditure is rejected and these expenditures are capitalized to the cause of assets. The assessee company will, however, be entitled to claim depreciation when the new project is set up and machinery is actually put to use and started commercial production." Like in the earlier year, in the p....
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....the same is incorporated in the assessment order for the A.Y 1999-2000 passed on 28.03.2002. Further, on the perusal of evidence and the terms and conditions in this assessment order the whole issue of SPN by the assessee has been held to be a colourable transaction. From the Annual Report and Annexed accounts for the F.Y 1996-97, it is seen that the assessee company has provided for interest on SPN in the A.Y 1997-98 also. In view of the detailed findings in the case of assessee company for the A.Y 1999-2000, I have reason to believe that income chargeable to income tax has escaped assessment in A.Y 1997-98." Despite strong objection from the assessee, the Assessing Officer proceeded to frame fresh assessment. In such order of ass....
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....the order of learned CIT (A) because if the income which is alleged to have been escaped the assessment, had already been taxed by the Assessing Officer in the original assessment order, it cannot be said that any income had escaped assessment and in that situation the very base of reopening does not survive as in the present case. Therefore, we decline to interfere in the order of learned CIT (A)." Learned counsel Shri Mehta for the Revenue vehemently contended that the CIT [Appeals] as well as the Tribunal both have committed an error in quashing the reassessment proceedings. He submitted that in the original assessment, the Assessing Officer only examined whether the expenditure in question was capital or revenue expenditure. Even if ....
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....ssing Officer during such assessment proceedings. He disallowed the expenditure and concluded that the same were capital expenditure and not revenue in nature and deduction was disallowed. He was conscious that in the previous year, CIT [A] had reversed the findings of the Assessing Officer on this point, however, to keep the issue alive; since the order of CIT [A] was carried in appeal before the Tribunal, he taxed the income accordingly. CIT [A], like in the previous year, deleted the addition holding that the expenditure was revenue in nature. It was at that stage that the notice for reopening came to be issued. Reasons recorded demonstrate that the same was founded on the Assessing Officer's belief that the liability was a contingent....
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....p for consideration before the Assessing Officer in the original assessment proceedings. After thorough scrutiny, the assessee's claim for deduction was disallowed. His attempt now to change the reasons for disallowance, once the CIT [A] reversed his order of assessment, would thus be a mere change of opinion. Our attention was drawn to a decision of this Court in case of United Phosphorus Limited v. Additional Commissioner of Income Tax, reported in (2011) 56 DTR (Guj) 193, in which it was held and observed as under : "14. Apart from the aforesaid position, a perusal of the statement showing allocation of income and expenses to eligible units and noneligible units for deduction under section 80I and 80IA of the Act (Annexure "F" to the ....